AP reports that Australia's highest court granted an Australian businessman the right to sue for defamation in Australia over an article published in the United States but posted on the Internet:

Analysts believe the ruling against international news service Dow Jones & Co. - believed to be the first by a nation's final court of appeal to deal with Internet defamation - could set a precedent for courts around the world and affect publishers and Web sites that post articles in the 190 nations that allow defamation cases.

"It's a judgment that will be looked at very closely by people in this area including the media right around the world," said Dr. Matthew Collins, a Melbourne lawyer and academic who has published a book on defamation and the Internet.

"What it means is that foreign publishers writing material about persons in Australia had better have regards to the standards of Australian law before they upload material to the Internet," he said.

The High Court of Australia unanimously dismissed an appeal by Dow Jones & Co. aimed at stopping a defamation suit in Australia by mining magnate Joseph Gutnick.

The issue of whether Australian-owned Kazaa can be sued for copyright infringement in the US is as yet unresolved. The world gets a little smaller every day - the law will have to follow.

Tim Blair comments from Australia:

UH-OH. Looks like Australia just ruined the Internet for everybody ... So you write something in the US about some crazy Third World despot and you get sued in his country. Great.

Internet "spooked," per The Australian:

OVERSEAS internet companies would start self-censoring to avoid being sued in Australia because of a High Court judgment yesterday, media organisations predicted.

The High Court ruled news service Dow Jones could be sued in Victoria for an allegedly defamatory story about miner Joe Gutnick that was put onto its website in the US.
News Limited (publisher of Australian IT), said the ruling would have particular impact on US internet publishers operating under laws guaranteeing free speech.

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